Press

CEO Self-Evaluation: To Thine Own Self (Assessment) Be True

Excerpt from the article. The full article can be viewed here. 

Mark warns against focusing only on the CEO’s achievement of financial metrics, particularly when the company has had a good year. In Mark’s view, financial metrics are “lagging indicators,” so regardless of how well the company has performed in any given year, it is important to focus on the future, and see how the CEO is contributing to the next year’s performance and the overall future of the company. As part of that non-financial “future-oriented” emphasis, Mark recommends that the self-assessment take into account strategy, talent development, company culture, and leadership—all factors that remain important for the long game.

Why HR Leaders Need to Forge New Relationships with Boards

Excerpt from the article. The full article can be viewed here. 

The magnitude of change predicted by management visionaries in the field of human resources will have limited impact unless organizational leaders can successfully engage directors in a similar rethinking of the strategic importance of talent, culture and workforce management, this according to a report by Mark B. Nadler, principal and co-founder of Nadler Advisory Services, and Anna A. Tavis, founder of advisory firm Global Plus Lab.

New approaches to the human capital function will demand new relationships with key constituents, they conclude, including boards of directors. “There are enormous challenges to making this shift,” said the authors. “Nevertheless, the opportunities are real and consequential.”

A surprising number of companies don’t have a CEO succession plan. Here’s why

Excerpt from the article. The full article can be viewed here. 

Whether they quit, retire, get fired or die, all CEOs eventually leave. The billion-dollar question is: Who should replace them?

The boards of 20% of public companies and 32% of private ones can’t answer that question.

That’s because they haven’t discussed long-term succession planning in the past 12 months, according to a survey conducted by the National Association of Corporate Directors.

A higher percentage haven’t even identified an interim CEO in case a CEO leaves abruptly.

But merely discussing a succession plan doesn’t really indicate whether a board is adequately prepared to replace an exiting CEO.

“I can tell you from having heard these conversations that they can be so perfunctory as to be almost meaningless,” said Mark Nadler, founder of Nadler Advisory Services, which counsels companies on succession issues and board effectiveness.

4 of the biggest mistakes a CEO can make

Excerpt from the article. The full article can be viewed here. 

1. Taking too long to fire a direct report

A high-functioning, cohesive executive team is critical to any CEO’s success, and therefore the company’s success. So it becomes a liability to keep a team member on board who isn’t a good fit.

Yet some CEOs will delay doing what they know in their gut they should do. Their reticence can stem from guilt because they brought the person on or they have a long history together. Or they worry that such a high-profile dismissal could raise concerns among investors and employees.

But just as often it’s their savior complex coming into play.

“CEOs convince themselves ‘I can save this person. If I just have enough time to work with them, I can turn them around,'” said Mark Nadler, principal and cofounder of leadership consulting firm Nadler Advisory Services.

2. Losing touch with front-line employees

If CEOs become insulated from middle managers and customer facing employees, they won’t have all the intelligence needed to make critical decisions.

“They’re the first to understand what’s happening in the marketplace that could be a threat to you,” Nadler said.

Plus, as companies become more decentralized, innovation often happens in the field, said Steve Morse, a senior member of the board and CEO advisory practice at Russell Reynolds Associates.

Morse recommends CEOs spend a lot of time in the field in their first 18 months. What’s more, the CEO and all team managers must actively foster an open culture that welcomes ideas and criticism from employees. And they should have a system — including surveys — by which to regularly collect and communicate that information to the corner office.

Navigating A New Management-Board Relationship

The Nadler Advisory Services white paper, “What Every Manager Should Know About The Board“, has been published on The Harvard Law School Forum under a new title: “Navigating A New Management-Board Relationship”. You can read their re-post here.

Internal CEO Hires Need More Help, Not Less

These are excerpts from the AGENDA article. Read the full AGENDA article here.

. . . Nadler, principal and co-founder of Nadler Advisory Services, says some boards and CEOs don’t take advantage of having an executive session of just the CEO and directors.

“Early on in a CEO’s tenure it’s a terrific way for them to talk candidly and get aligned,” Nadler says. “It’s like a cast of thousands in some board meetings — the walls are lined with chairs filled with people from management. It completely changes the dynamic of the meeting and becomes much more formal.”

. . . Meanwhile, the company can revert back to business as usual if the new CEO doesn’t start moving forward on two or three high-priority issues, as a 2013 CEO study, “Move Faster Drive Harder,” co-authored by consultant Mark Nadler, found.

. . . Isabella Bank appears as a successful (CEO) succession case study in a recently published book, The Handbook of Board Governance.

Find Out More

Mark Nadler cites the Isabella Bank story in his chapter called “CEO Succession”. You can find The Handbook of Board Governance here.

You can also read about overcoming some of the challenges of CEO Succession in the Nadler Advisory Services white paper “CEO Evaluation — Navigating a New Relationship With the Board”. 

Nadler Advisory Services specialize in helping CEO’s with transitions. Learn more here.

The ‘double-edged sword’ of a high-profile board member

Mark Nadler, principal and co-founder of Nadler Advisory Services, consults to executive teams and boards of directors. He said directors should elect other members based on company needs regardless of their name or reputation, much like Cox’s strategy.

In the past, Nadler said boards would seek out high-profile members for the sake of publicity. Now, companies seem more likely to appoint those best suited for the position.

“Everybody has to bring something to the table or else they’re taking up space,” he said.

Just as executives shouldn’t appoint members based on reputation, Nadler said they also shouldn’t turn someone away for the same reason.

However, because of Sebelius’ political background, Nadler said potential Humacyte investors are likely waiting to see how the election season unfolds before making a move. Sebelius could lose her federal government connections depending on the outcome of the presidential election, which could deter or encourage investors.

“It’s really a double-edged sword,” Nadler said.

Read the full article at http://www.bizjournals.com/

Everyone’s a Target: Activism’s Mega Year

“The biggest change in the overall behavior of boards may come not from Sarbanes-Oxley and Dodd-Frank and people interested in good governance,” says Mark Nadler, principal at Nadler Advisory Services, a board and executive consultancy firm. “It may in fact come from the influence of the marketplace making it clear to boards that they need to be doing what they should have been doing all along: thinking and acting on behalf of the shareholder.”

Download the full article, here.
Read the article online, Agenda here.

Assessing Appraisals: How Boards Evaluate Their CEOs

“You can certainly understand why the board . . . is looking very aggressively at how the company performs when it comes to wealth creation for investors…The dilemma is that you’re looking for immediate and dramatic results, and very often those are realistically beyond the CEO’s capacity to affect the company in a dramatic way.” 
— Mark Nadler

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Read the article online, Agenda here.

“CEO’s Cast Long Shadows” — on the Cisco Systems, Inc. CEO Succession

Transcript excerpt:

THOMPSON: Former CEOs cast long shadows. Remember Starbucks (NASDAQ:SBUX) chairman Howard Schultz returned to CEO following the disappointing run for the coffee chain. And while he’s no longer CEO, Oracle (NASDAQ:ORCL) Chairman Larry Ellison remains the face of the software firm he founded.

(on camera): Executive coach Mark Nadler saying best practices dictate a former CEO should probably stay on as chairman for a year or less then leave.

(voice-over): Nadler citing Steve Ballmer’s resignation as Microsoft’s chairman less than a year after stepping down as CEO as being exemplary. This gave successor Satya Nadella the freedom to plot a new and clear course for the software firm. Chambers’ future, however, is less clear. Cisco (NASDAQ:CSCO) says his term as chairman is indefinite, something that could definitely create problems for Robbins.

For NIGHTLY BUSINESS REPORT, I’m Mary Thompson.